Canadian sporting goods distributor collapses amid group liquidity strain and US affiliate exposure

On December 5, 2025, BRS Canada Acquisition Inc. filed an assignment in bankruptcy under the Bankruptcy and Insolvency Act. KSV Restructuring Inc. was appointed as Licensed Insolvency Trustee.

BRS Canada Acquisition Inc. was incorporated under the laws of British Columbia on April 28, 2011 and operated as a Canadian sporting goods distributor. The company was headquartered in Barrie, Ontario and, as of the assignment date, operated three leased distribution centres located in British Columbia, Manitoba, and Ontario. The company functioned as a Canadian subsidiary of Big Rock Sports, LLC, a US-based distributor of sporting and hunting firearms, fishing gear, and camping equipment.

Prior to the bankruptcy filing, the company retained SB360 Capital Partners, LLC to conduct a liquidation of inventory and to collect accounts receivable. Following the assignment, the trustee entered into a consulting and marketing services agreement with SB360 dated December 5, 2025 to continue asset realization activities that had already commenced.

The trustee’s preliminary review indicates that the company’s financial position was materially affected by group-wide liquidity management arrangements with its US parent. The company was party to a revolving credit facility with Regions Bank and participated in non-cash intercompany funding mechanics designed to support Big Rock’s compliance with borrowing base requirements under its own asset-based lending facility.

These intercompany transactions, recorded beginning in or around mid-2024, resulted in a significant intercompany receivable balance owed by Big Rock to the company. The trustee does not expect this balance to be recoverable, as Big Rock is not anticipated to repay Regions in full. In parallel, declining realizable values for inventory, receivables, and equipment constrained recovery prospects at the Canadian level.

As of the date of bankruptcy, the company terminated all 72 employees, with accrued wages and vacation pay paid prior to termination. Certain former employees were subsequently retained on short-term task letters to assist with inventory disposition and wind-down of distribution centre operations. The trustee expected to disclaim the leases for all three distribution centres and the Barrie head office by December 31, 2025.

Book value assets as at the assignment date totaled approximately $65.1 million, including cash, accounts receivable, inventory, property and equipment, goodwill, intellectual property, intercompany receivables, and other assets. Preliminary estimates prepared by SB360 indicate materially lower realizable values, with inventory, receivables, and select intangible assets representing the primary sources of recovery. Goodwill and intercompany receivables are not expected to yield any realizations.

Based on the estimated realizations and the secured debt outstanding, the trustee does not expect proceeds, net of administration costs, to be sufficient to repay secured lender Regions Bank, acting as administrative agent for a syndicate of lenders, in full. The company owes approximately $2.57 million in direct borrowings and $17.7 million of guaranteed debt.

Unsecured creditor claims are estimated to exceed $7 million based on the company’s books and records.

Blake, Cassels & Graydon LLP is counsel for the bankruptcy trustee.